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Brazilian steelmaker CSN has been going through some turbulence since the incident at its No. 3 blast furnace in late April. Sources in Brazil note there have been delays in deliveries and it has been reported the company ordered a batch of slab from Iran to roll at its steelmaking complex in Rio de Janeiro state.

At the time of the incident, CSN’s subsidiary in the US released a statement to its customers affirming its teams were evaluating the degree of the damage and the expected market impact of the mishap, including its effect on the North American order book.

Queried, CSN’s headquarters in Sao Paulo confirmed there were “leakage emissions” from the equipment but that the problem was already under control. The company later confirmed the unit was back on stream.

In mid-July, a source from CSN affirmed the company was indeed facing difficulties in deliveries and also that the company has purchased imported slab.

Along with all that, an executive from Iranian steel producer Khouzestan Steel Company (KSC) said an assessment team from CSN has audited units of KSC in the country and ordered some 100,000 mt of slab to be shipped soon. CSN declined to comment.

Amidst this entire imbroglio, Brazilian flats makers, including CSN, announced three price hikes (in April, May and June) on hot-rolled and cold-rolled coils, as well as on hot-dip galvanized sheet, totaling 33%. The main purpose was the recovery of margins that were squeezed especially in 2015 and also the appreciation of these products in the international market — especially China, mills said.

Due to the complicated (and delicate) economic and political times in Brazil — a president to be tried in an August impeachment proceeding, the uncertainty about what is going to happen next and an economic recession with the GDP expected to be -3.25% in 2016 — sources confirmed these sheet price hikes did not completely stick.

As if all that were not enough, there also is the fluctuating currency exchange. When the price hikes started being implemented, it was around Real 3.60/$1. In mid-July, it was around Real 3.25/$1. This matter is especially important because a stronger dollar results in a natural deceleration of imports.

There are many factors at work, so let’s review:

CSN is having problems with deliveries following its BF mishap. It decided to import slab. Chinese prices went up. The US dollar appreciated...